Gas Plus

Investor Presentation • Mar 28, 2017

Analyst Presentation FY 2016 Financial Results March 28th, 2017

www.gasplus.it

INDEX

• HIGHLIGHTS
• FINANCIAL RESULTS

MARKET SCENARIO

Market

HIGHLIGHTS

Highlights

• E&P: remarkable progress in the development projects:
• The first new gas-in (Mezzocolle) expected in 2Q 2017
• The EIA and the local municipalities authorizations obtained for the main project, Longanesi
• E&P: the results were negatively influenced by a) the hydrocarbon price scenario; b) the production being consistently interrupted in one of E&P's main concession, which is not operated by the Group
• Commercial activities benefited from the wholesale market exit and showed a margin growth reaching the highest result in the history of the B.U.
• Network & Transportation: increment in the profitability and the distributed volumes mainly thank to the acquisition of two new distribution concessions
• Increase of NFP due to the E&P investments restart

FINANCIAL RESULTS: E&P E&P

SOCIETA' PADANA ENERGIA MAJOR PROJECTS UPDATE

Longanesi		Mezzocolle
• Hydrocarbons: Gas • Reserves: ~ 1.1 BScm • Peak production: 230 MScm/year	• • •	Hydrocarbons: Gas Reserves: ~ 300 MScm Peak production: 40 MScm/year

Other project

• Hydrocarbons: Gas
• Reserves: ~ 300 MScm
• Peak production: 40 MScm/year

R&D

• Lab Cavone: first O&G site for testing and monitoring
• Exploration & Reasearch: several exploration project

SOCIETA' PADANA ENERGIA KEY FACTORS

FINANCIAL RESULTS: E&P E&P

FY 2016 P&L - E&P contribution
E&P (M€)	FY16	FY15	% Change	2H16	2H15	% Change
Hydrocarbon Production
(MScme)	141.4	154.1	-8.2%	65.3	74.5	-12.3%
of which natural gas	115.9	126.8	-8.6%	52.9	59.6	-11.2%
of which oil and condensate	25.5	27.3	-6.6%	12.4	14.9	-16.8%
EBITDA	5.0	20.1	-75.1%	3.0	5.9	-42.2%
Exploration Capex	1.7	3.6	-52.8%	0.6	2.6	-76.9%
Development Capex	11.6	5.2	+123.1%	6.2	3.0	+106.7%

• Exploration & Development:
• Domestic activity:
  • "Longanesi" project: EIA obtained and ongoing detail engineering.
  • The construction activities for Mezzocolle gas-in are nearing completion.
  • The Ministry of Economic Development, the Emilia Romagna Region and Società Padana Energia agreed with the new Cavone Laboratory Protocol, which makes Cavone the first E&P site in Italy to experimentally adopt the new guidelines related to monitoring.

International activity :

• Ongoing activities in the shallow water offshore concessions "Midia Shallow and Pelican" for the development of the already discovered reserves (1.4 BScm)
• "Media Deep" joint venture in the deep water of the Black Sea, which was led by ExxonMobil, decided to relinquish the high risk reward Midia Deep project.
• Containment of production decline despite (i) no gas-in during last year and (ii) the missed production contribution of Garaguso concession.
• EBITDA decrease was largely driven by lower hydrocarbon prices. Its effects have been limited by the constant control of operating costs.

As of December 31th , 2016 2P hydrocarbon reserves: 4.5 BScme.

FY 2016 P&L – Retail contribution

Retail Gas Assets (MScm)	FY16	FY15	% Change	2H16	2H15	% Change
Sales (MScm)	90.7	97.3	-6.8%	38.2	37.7	+1.2%
Residential	70.9	73.5	-3.5%	29.7	27.9	+6.3%
Small Business/Multipod	12.7	14.1	-10.2%	5.2	5.7	-7.4%
Industrial	7.0	9.7	-27.2%	3.2	4.1	-21.2%
EBITDA	6.7	5.7	18.3%	3.0	2.7	+12.5%

• EBITDA has grown significantly in 2016 due to the increased profitability of all its clusters (residential, small business, industrial). This is the best historical result despite of:
• the price decline (TTF²⁰¹⁶ Vs. TTF²⁰¹⁵ : -30%);
• the sales volume reduction.

FINANCIAL RESULTS: N&T and Storage

FY 2016 P&L – N&T Contribution

NETWORK (M€)	FY16	FY15	% Change	2H16	2H15	% Change
Distributed Volumes (MSmc)	194.0	180.4	+7.5%	88.1	78.6	+12.1%
Direct end users (#K)	95.8	89.4	+7.2%	n.m.	n.m.	n.m.
Pipeline (Km)	1,558.9	1,475.2	+5.7%	n.m.	n.m.	n.m.
CAPEX	5.4	0.8	+551.4%	0.7	0.4	89.5
EBITDA	6.8	6.5	+3.0%	2.9	2.8	+6.8%

Network

• Positive increment of EBITDA.
• The distributed volumes increased in 2016 thanks to the acquisition of the Manerbio and Bassano Bresciano distribution concessions, being effective on consolidated margin from May 2016.
• Ongoing activities aimed to achieve objectives related to the energy saving certificates (TEE).

TRANSPORTATION (M€)	FY16	FY15	% Change	2H16	2H15	% Change
Transported Volumes (MSmc)	9.2	8.9	+3.6%	4.1	3.5	+16.2%
Pipeline (Km)	41.8	41.9	-0.1%	n.m.	n.m.	n.m.
EBITDA	0.2	0.2	-6.3%	0.1	0.1	30.3%

Storage projects:

All the three projects are located in Central Italy, an area characterized by few storage sites. In addition, being the three projects in the same area allows potential operational synergies:

• SAN BENEDETTO (84.7% GP - Operator): EIA obtained in June 2014. During 2016 the Group increased its interest in this JV from 49% to 84.7%
• POGGIOFIORITO (100% GP): EIA obtained in June 2014
• SINARCA (60% GP - Operator): Final authorization and technical assessment

	FY 2016 – Group P&L
Group (M€)	FY16	FY15	% Change	IIH16	IIH15	% Change
Revenues	82.4	104.6	-21.2%	36.9	42.3	-12.7%
Operating Costs	65.3	73.1	-10.7%	29.0	31.7	-8.5%
EBITDA	17.1	31.5	-45.6%	7.9	10.6	-25.1%
EBIT	0.9	3.4	-74.1%	1.5	(8.4)	117.8%
EBT	(7.3)	(1.4)	-423.5%	(2.2)	(10.7)	79.6%
Disc. operations	-	(1.3)	n.m.	-	(0.5)	n.m.
Net Result	(4.2)	7.2	-159.0%	(0.8)	1.3	-157.4%
EPS (€)	(0.09)	0.16	-159.0%	(0.02)	0.03	-157.4%

The data shown in the table do not take into consideration, at the EBITDA, EBIT and EBT level, the results of the S&S business unit which is included within the specific item "discontinued operations"

FY 16 Financial results

• Revenues decreased due to the lower price scenario and the lower hydrocarbon production . The 2015 amount included also € 5.3 M of non-recurring items related to E&P activity
• Overall EBITDA reduction due to the decrease of Business Unit E&P Ebitda that anyway remained positive
• Positive value of EBIT despite of the E&P asset depreciation of Midia Deep concession
• The Group recorded a Net Result of € 4.2 M vs. € 7.2 M of FY15

FINANCIAL RESULTS

Financial Result

-0.4 0.1 -3.6 -3.4 -4.3 -4.4 1.7 -0.3 0.2 -0.6 Short Term Financial Charges Long Term Financial Charges Charges on Funds NPV Other Financial Charges Financial Revenues 20.1 5.0 6.5 6.8 5.7 6.7 - 0.8 - 1.4 E&P Network Retail Other Group Net Result evolution (M€) FY 2016 Consolidated results EBITDA breakdown by BU (M€) 31.5 17.1 FY15 FY16 8.6 FY15 FY16 Net Financial Charges evolution (M€) 6.4 7.2 - 14.4 11.8 - 3.4 - 6.7 1.3 -4.2 FY15 EBITDA D&A Financial charges % Other Taxes Disc. Op FY16 31.5 - 15.1 0.3 1.0 - 0.6 17.1 FY15 E&P Network Retail Other FY16 Group EBITDA evolution (M€)

The data shown above do not take into consideration the results of the S&S business unit unless where specified as "discontinued operations" item

FINANCIAL RESULTS

Dicember 31, 2016 – Group Balance Sheet

	December 31, 2016	December 31, 2015	% Change
Group (M€)
Inventories	4.1	4.2	-0,9%
Receivables	19.0	16.8	3.8%
Payables	(22.2)	(21.8)	1.8%
Other working Credits/Debits	0.6	2.7	-77.1%
Non current Assets	448.2	447.1	0.2%
Taxes, Abandonment, Severance and Other provision	(182.4)	(184.3)	-1,0%
Net invested capital	267.3	264.7	1,0%
Net Financial Debt	53.0	41.1	28.5%
of which long term	34.8	69.6	-50.0%
of which short term	18.2	-28.5	-163.8%
Equity	214.3	223.6	-4.1
Total Sources	267.3	264.7	1.0%

• Working capital on the low levels of the recent periods.
• Increase in Net Financial Debt vs. 31 Dec 2015 due to the investment restart. The low level of the previous year was due to the investment postponement.
• D/E ratio move from 0.18 to 0.25

FINANCIAL RESULTS

• The Group confirmed the low level of NFP, whose amount will increase only with new relevant investments
• The Group has also secured financial resources for future E&P investments thanks to a € 64 M capex line

COMPANY PROFILE

Shareholding as at 31 Dec 2016 Share information

N. of share: 44,909,620 Share price as of 30/12/2016: € 2.426 Share price as of 27/03/2017: € 2.9553. Mkt cap 31/12/2016 : € 109.0 million Italian Stock Exchange – segment MTA Own shares as of 31/12/2016: 1,336,677

Share price performance

Group structure Management

Davide Usberti	Chairman and CEO Gas Plus S.p.A; Chairman Gas Plus International B.V. (E&P Int. Activities)
Lino Gilioli	.VP and Lead Independent Director Gas Plus S.p.A.
Cinzia Triunfo	Group General Manager and Director of Gas Plus S.p.A. Executive VP Gas Plus International B.V. (E&P Int. Activities)
Germano Rossi	Group CFO
Massimo Nicolazzi	Executive VP Gas Plus International B.V. (E&P Int. Activities)
Regulated Activity - Network
Leonardo Dabrassi	Chairman – GP Infrastrutture Srl
Achille Capelli	Director Network

Disclaimer

This presentation contains forward-looking statements concerning the financial condition, results of operations and businesses of Gas Plus. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements are statements of future expectations that are based on management's current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward-looking statements include, among other things, statements concerning the potential exposure of Gas Plus to market risks and statements expressing management's expectations, beliefs, estimates, forecasts, projections and assumptions. These forward-looking statements are identified by their use of terms and phrases such as ''anticipate'', ''believe'', ''could'', ''estimate'', ''expect'', ''intend'', ''may'', ''plan'', ''objectives'', ''outlook'', ''probably'', ''project'', ''will'', ''seek'', ''target'', ''risks'', ''goals'', ''should'' and similar terms and phrases. There are a number of factors that could affect the future operations of Gas Plus and could cause those results to differ materially from those expressed in the forward-looking statements included in this Report, including (without limitation): (a) price fluctuations in crude oil and natural gas; (b) changes in demand for the Group's products; (c) currency fluctuations; (d) drilling and production results; (e) reserve estimates; (f) loss of market and industry competition; (g) environmental and physical risks; (h) risks associated with the identification of suitable potential acquisition properties and targets, and successful negotiation and completion of such transactions; (i) the risk of doing business in developing countries and countries subject to international sanctions; (j) legislative, fiscal and regulatory developments including potential litigation and regulatory effects arising from recategorisation of reserves; (k) economic and financial market conditions in various countries and regions; (l) political risks, project delay or advancement, approvals and cost estimates; and (m) changes in trading conditions.

All forward-looking statements contained in this presentation are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers should not place undue reliance on forward-looking statements. Each forward-looking statement speaks only as of the date of this presentation. Neither Gas Plus nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information. In light of these risks, results could differ materially from those stated, implied or inferred from the forward-looking statements contained in this presentation.